Login to your account

E15 Sales Plummet. Thanks, RVP.

The growing momentum in E15 sales in Minnesota came to a screeching halt in June as the EPA’s long-outdated RVP (Reid Vapor Pressure) rule took effect.

According to data from the Minnesota Department of Commerce, E15 sales plummeted 58 percent to 499,131 gallons in June from 1.19 million gallons in May.

To recap, from June 1 - Sept 15, the RVP limit is set to 9.0 to reduce evaporation of fuel from cars and storage and transfer equipment during the summer months. When gasoline evaporates, it contributes to smog. The PSI for E10 increases by 1 during the summer months but Congress-imposed an RVP waiver for E10 years ago.

In the case of E15, the Department of Energy's National Renewable Energy Laboratory (NREL) says the RVP for E15 is indistinguishable from E10. However, in absence of a waiver from Congress or the EPA (which is currently the case), E15 can't be sold during the RVP season.

Since the RVP ban doesn't extend to flex fuels, many retailers label E15 as a flex fuel to avoid substantial losses. Nonetheless, selling E15 as a flex fuel severely limits the number of vehicles that can use it as illustrated in the volume recorded for June.

Prior to June, E15 sales in Minnesota were at the highest it has ever been. In the three months before June, the monthly volume in Minnesota averaged over a million gallons.

Even more frustrating is that the drop in volume was not unexpected. In 2015, Minnesota’s E15 volume fell at a similar rate in June. It’s no coincidence that the volume in June 2017 (499,131 gallons) is the lowest that’s been recorded since the tail-end of the RVP season in September 2016 (320,729 gallons).

And unless the current administration walks its talk, we’ll be revisiting this scenario again next year.

True, there have been efforts in Congress to lift the RVP ban on E15 but unfortunately, the most recent bill had more opponents (comprising of legislators from oil-producing states) than supporters. And as long as this disparity exists, it is unlikely RVP parity will be achieved through Congress.

The administration often talks about removing antiquated regulations and burdens to businesses. By that definition, the RVP must rank high among its priorities.

After all, the RVP ban hurts the ethanol industry and that in turn hurts the agriculture industry. It hurts retailers, most of whom are small businesses that have invested heavily to offer E15. And it hurts consumers by depriving them of a choice of a homegrown fuel that reduces harmful emissions.

Ironically enough, it was only in June when President Donald Trump told an audience in Iowa: “By the way, we’re saving your ethanol industries in the state of Iowa just like I promised I would do in my campaign. Believe me they are under siege, folks. I don’t know if you know it, but they are under siege.”